Written by John Krystof on February 5, 2013

People often complain, especially in middle age, that life’s demands are so great, it’s hard to find ways to save money instead of relying on credit. However, with a bit of creativity, lots of money can be saved from everyday activities that we spend on daily. While the savings from each of these approaches may seem small, they add up quickly.

Examining the Personal Budget

The first place to start for finding savings is the family budget. If one is not already written down, take some time to do so. You’ll be surprised where regular income goes every month and by how much. Once the budget is figured out, break up the expenses into “sunk costs” versus “variable expenses.” Sunk costs include firm bills that have to be paid and don’t change much from month to month. These include the mortgage, the car payment, insurance, tuition, preschool costs, student loan payments, taxes, rent, and so on. These numbers can’t be changed by much as long as they exist, so there’s no point in focusing on them for savings.

Variable expenses are those things people pay for every month but the numbers can change, depending on activity. These include food, utilities, vehicle fuel, amenities, miscellaneous cash charges, phone and cable bills, travel and transportation, and similar. The underlying point to remember is that these types of expenses are controllable. How people behave every day makes a difference in how much is charged. With the above budget figured out, it’s time to start finding savings.

Trimming Down and Saving

Most of the variable expenses paid every month feel like bills that we have to pay. However, there are ways to reduce these expenses considerably:

• Food – Groceries are probably the biggest variable expense a household pays for regularly yet it’s also the most fluid. These costs go up and down, depending on the season and holidays, for all sorts of consumables. While most people are not going to change much in terms of what they eat outside of driving reason, they can change how much is paid for the food. Coupons, discounts, market advertisements and membership benefits with specific stores all produce savings that can reach as much as 10 to 20 percent per grocery store visit. If a person is spending $800 a month on food, the savings can total $960 to $1,920 a year. That’s real cash that can be diverted to a savings account each week based on the savings at the bottom of the receipt. And most stores print out how much was saved with coupons and store discounts.

• Dining Out – Many adults like to dine out in the morning, for lunch in the work day, and in the afternoon on the way home. The average adult pays something in the neighborhood of $5 for coffee, $6 for breakfast, $10 for lunch, and $5 for a snack and drink in the day on the way home. That comes out $26 a day. With 230 odd workdays in the year (after holidays, weekends, and vacation are taken out), that cost will total $5,980 a year or $498 a month. If a person just packs a lunch and avoids a snack on the way home, after costs, he could probably divert $2,300 annually to savings or $191 a month.

• Getting Fit Saves Money – While there’s not a direct correlation of $1 for calorie, getting in shape and reducing overeating can also save money on both groceries, eating out and on health costs. Fit people generally tend to get sick less often, recover faster, and eat less expensive junk food. That in turn creates multiple savings in grocery bills, daily expenses, and avoided medical costs. All of those impacts can preserve savings rather than eating away at them throughout the year.

• Transportation – While not everyone can give up their car, those who aren’t encumbered with dropping off the kids at school and fair weather can easily take advantage of public transportation or biking to work to reduce vehicle and gas costs. With the average car needing $40 a week in fuel for a 20 mile commute daily, converting over to a bus pass for the month could save $100 a month or $1,200 a year that can go right into savings. Further, many employers reimburse public transit costs of employees, allowing more money to be saved monthly.

• Reducing the Utilities – The average home spends hundreds of dollars a month on electricity and natural gas for a family to live in. With the use of a smart monitor inside, those utilities can be managed better, even remotely, to score savings each month when people aren’t at home. By simply being more conservative each month on utility use, a family could realize up to a $50 savings, which turns into $600 a year.

• Recycling – It seems messy but recycling cans and plastic bottles can produce serious cash. The average family can create $5 to $10 of recycling material a week. Collected 52 weeks a year, That comes out to a recover of $260 to $520 in hard cash that can go right into a savings account after dropping off the various recyclables.

What Else?

There are plenty of more ideas of how to find big savings on the margin, adding to the $6,540 in potential savings noted above. Once started, many savers start naturally finding new ways to save without changing their lives dramatically and diverting money to a savings account without much effort. So before throwing one’s hands up in the air and arguing saving money is impossible, think twice. Many times, saving money is simply a matter of changing the way we behave everyday.

People often complain, especially in middle age, that life’s demands are so great, it’s hard to find ways to save money instead of relying on credit. However, with a bit of creativity, lots of money can be saved from everyday activities that we spend on daily. While the savings from each of these approaches may seem small, they add up quickly.

Examining the Personal Budget

The first place to start for finding savings is the family budget. If one is not already written down, take some time to do so. You’ll be surprised where regular income goes every month and by how much. Once the budget is figured out, break up the expenses into “sunk costs” versus “variable expenses.” Sunk costs include firm bills that have to be paid and don’t change much from month to month. These include the mortgage, the car payment, insurance, tuition, preschool costs, student loan payments, taxes, rent, and so on. These numbers can’t be changed by much as long as they exist, so there’s no point in focusing on them for savings.

Variable expenses are those things people pay for every month but the numbers can change, depending on activity. These include food, utilities, vehicle fuel, amenities, miscellaneous cash charges, phone and cable bills, travel and transportation, and similar. The underlying point to remember is that these types of expenses are controllable. How people behave every day makes a difference in how much is charged. With the above budget figured out, it’s time to start finding savings.

Trimming Down and Saving

Most of the variable expenses paid every month feel like bills that we have to pay. However, there are ways to reduce these expenses considerably:

• Food – Groceries are probably the biggest variable expense a household pays for regularly yet it’s also the most fluid. These costs go up and down, depending on the season and holidays, for all sorts of consumables. While most people are not going to change much in terms of what they eat outside of driving reason, they can change how much is paid for the food. Coupons, discounts, market advertisements and membership benefits with specific stores all produce savings that can reach as much as 10 to 20 percent per grocery store visit. If a person is spending $800 a month on food, the savings can total $960 to $1,920 a year. That’s real cash that can be diverted to a savings account each week based on the savings at the bottom of the receipt. And most stores print out how much was saved with coupons and store discounts.

• Dining Out – Many adults like to dine out in the morning, for lunch in the work day, and in the afternoon on the way home. The average adult pays something in the neighborhood of $5 for coffee, $6 for breakfast, $10 for lunch, and $5 for a snack and drink in the day on the way home. That comes out $26 a day. With 230 odd workdays in the year (after holidays, weekends, and vacation are taken out), that cost will total $5,980 a year or $498 a month. If a person just packs a lunch and avoids a snack on the way home, after costs, he could probably divert $2,300 annually to savings or $191 a month.

• Getting Fit Saves Money – While there’s not a direct correlation of $1 for calorie, getting in shape and reducing overeating can also save money on both groceries, eating out and on health costs. Fit people generally tend to get sick less often, recover faster, and eat less expensive junk food. That in turn creates multiple savings in grocery bills, daily expenses, and avoided medical costs. All of those impacts can preserve savings rather than eating away at them throughout the year.

• Transportation – While not everyone can give up their car, those who aren’t encumbered with dropping off the kids at school and fair weather can easily take advantage of public transportation or biking to work to reduce vehicle and gas costs. With the average car needing $40 a week in fuel for a 20 mile commute daily, converting over to a bus pass for the month could save $100 a month or $1,200 a year that can go right into savings. Further, many employers reimburse public transit costs of employees, allowing more money to be saved monthly.

• Reducing the Utilities – The average home spends hundreds of dollars a month on electricity and natural gas for a family to live in. With the use of a smart monitor inside, those utilities can be managed better, even remotely, to score savings each month when people aren’t at home. By simply being more conservative each month on utility use, a family could realize up to a $50 savings, which turns into $600 a year.

• Recycling – It seems messy but recycling cans and plastic bottles can produce serious cash. The average family can create $5 to $10 of recycling material a week. Collected 52 weeks a year, That comes out to a recover of $260 to $520 in hard cash that can go right into a savings account after dropping off the various recyclables.

What Else?

There are plenty of more ideas of how to find big savings on the margin, adding to the $6,540 in potential savings noted above. Once started, many savers start naturally finding new ways to save without changing their lives dramatically and diverting money to a savings account without much effort. So before throwing one’s hands up in the air and arguing saving money is impossible, think twice. Many times, saving money is simply a matter of changing the way we behave everyday.

About John Krystof

John Krystof writes about personal finance and money matters for RateZip.com. He was born and educated in Central Europe, but presently resides in New York City.

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